The aspartic protease β-secretase (BACE) cleaves the amyloid precursor protein into a 42 residue β-peptide, which is the principal biochemical marker of Alzheimer's disease. Multiple explicit-water molecular dynamics simulations of the apo and inhibitor bound structures of BACE indicate that both open- and closed-flap conformations are accessible at room temperature and should be taken into account for inhibitor design. Correlated motion is observed within each of the two lobes of BACE, as well as for the interfacial region. A self-inhibited conformation with the side chain of Tyr71 occupying the S₁ pocket is present in some of the unbound simulations. The reversible loss of the side chain hydrogen bond between the catalytic Asp32 and Ser35, due to the concomitant reorientation of the Ser35 hydroxyl group and a water molecule conserved in pepsin-like enzymes, provides further evidence for the suggestion that Ser35 assists in proton acceptance and release by Asp32 during catalysis.